The impact of unprecedented health reforms is coming into clearer view as millions of Americans work to tap into new insurance benefits ushered in by the Patient Protection and Affordable Care Act, commonly referred to as Obamacare.

Some say the coverage offers the chance for a new way of life.

Others struggle to afford the now mandated health insurance. Still others don’t understand how the new benefits work for them.

The Ohio region boasts examples of the law’s most touted successes and failures. The stories reach beyond the Tri-State, resonating across the country to the nation’s capital where policy makers and politicians are working to revamp or uproot the multi-billion-dollar law meant to curb the country’s escalating health care costs.

This article, the fourth of five parts, was originally published by . Oher segments in this series can be found here:

Newly insured using benefits, but unpaid bills still a problem

WCPO.com

Monday, March 9, 2015

As hundreds of thousands of residents across the region put new health care benefits to the test, doctors and hospitals are reporting a mixed bag of gains and growing pains.

Nationally, more than 10 million Americans are estimated to have signed up for insurance in the last year under the Affordable Care Act’s new online marketplaces and expansion of Medicaid in 27 states.

Locally, health care providers report unprecedented shifts in the number of patients coming through who previously couldn’t pay their bills.

At Mercy Health – Ohio’s largest health system operator – the number of uninsured patients dropped 60 percent in 2014 among those checking in for an inpatient stay. Among outpatients, those who were uninsured fell 35 percent, officials told WCPO.

At UC Health, the percentage of uninsured was cut nearly in half, and now accounts for about 8.5 percent of all patients seeking care, down from 14 percent.

“It’s a significant shift and it’s headed in the right direction,” said Tim Maloney, vice president of payor relations at UC Health.

Cutting down on the number of patients who can’t pay their bills is considered critical to achieving a fundamental goal of the ACA: Stemming the country’s trend of skyrocketing health care costs.

Other trends under way in health care could offset recent gains as some consumers find themselves shouldering more of their health costs.

“If you’re a hospital, that means you now have to collect more of your revenue stream from a patient, rather than an insurer,” said Zac Stillerman, a general manager with the D.C.-based health care research and consulting firm . “That’s a big change.”

The toll of an unpaid doctor’s bill

For decades, health care experts have blamed America’s escalating health care costs in large part on patients who show up in emergency rooms sick and unable to pay.

Those unpaid bills, known as a hospital or doctor’s uncompensated care costs, are either written off as bad debts that can’t be collected or as charity care for those who can’t pay.

In 2012, uncompensated care costs across the U.S. were estimated to be as high as $51 billion.

To make up for the loss, doctors and health systems build those costs into their fees. And that gets passed on to those who do pay.

The ACA aims to tackle this cost conundrum by mandating that most Americans have health insurance coverage. The argument being that those who have health insurance visit their doctor more often. Doing that, keeps patients healthier and out of the emergency room where care is the costliest.

In 2014, savings from those unpaid bills is estimated to be $5.7 billion. Still, health systems locally and nationally say the gains are muted by other market dynamics.

Like its competitors, Avondale-based TriHealth has seen a drop in the uninsured since Ohio’s expansion of Medicaid last year.

But reimbursement rates from Medicaid to the health system are “too low,” said Joe Kelley, a health system spokesman.

"We're seeing more and more under-insured people who can't pay the high deductibles that come with the insurance they now have," Kelley said.

As high-deductible plans increase, health systems on watch

Nationally, more than 80 percent of consumers who bought a health insurance plan through the new marketplaces took on a deductible of $2,500 or more.

Outside of the marketplaces, 25 percent of employer coverage has moved to plans with high deductibles. That number was 5 percent a decade ago.

“That’s tough because now those consumers are on the hook for every one of those dollars before their coverage kicks in, and many don’t understand that it’s their obligation,” said the Advisory Board’s Stillerman.

A recent analysis by the Advisory Board of high-deductible plans found that the higher the patient obligation, the less likely they were to pay their bills in full. It also noted that reimbursement rates to doctors from exchange plans are lower than commercial offerings.

As the shift to higher deductible plans unfolds, health system executives say, it will take some time for consumers and providers to adjust.

“For so long, the person receiving the health care was so disconnected from paying for it. Your employer was always paying most of the bill. Health reform, if anything, is trying to connect the dots by putting more purchasing power in the consumer's hands to make those buying decisions.” - Chris Bergman, CFO - The Christ Hospital

The trends could force more health systems to take on even larger roles in engaging patients earlier about their financial obligations.

“If we play this forward five years, I think most hospitals and health systems are going to get a lot more sophisticated about how to quote their prices,” said Stillerman.

The trend could yield new innovations to help consumers shop for providers.

“You can even imagine a scenario where there’s parallel technology to an Orbitz or Experian that would empower consumers to make decisions based on their coverage, the quality and the price,” said Stillerman.